Immigration and the Occupational Choice of Natives: A Factor Proportions Approach

45 Pages Posted: 30 Jul 2011

See all articles by Javier Ortega

Javier Ortega

Kingston University London; London School of Economics & Political Science (LSE) - Department of Government; Institute for the Study of Labor (IZA); University College London - CReAM - Centre for Research and Analysis of Migration

Gregory Verdugo

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES)

Multiple version iconThere are 2 versions of this paper

Date Written: July 2011

Abstract

This paper evaluates the impact of immigration on the labor market outcomes of natives in France over the period 1962-1999. Combining large (up to 25%) extracts from six censuses and data from Labor Force Surveys, we exploit the variation in the immigrant share across education/experience cells and over time to identify the impact of immigration. In the Borjas (2003) specification, we find that a 10% increase in immigration increases native wages by 3%. However, as the number of immigrants and the number of natives are positively and strongly correlated across cells, the immigrant share may not be a good measure of the immigration shock. When the log of natives and the log of immigrants are used as regressors instead, the impact of immigration on natives' wages is still positive but much smaller, and natives' wages are negatively related to the number of natives. To understand this asymmetry and the positive impact of immigration on wages, we explore the link between immigration and the occupational distribution of natives within education/experience cells. Our results suggest that immigration leads to the reallocation of natives to better-paid occupations within education/experience cells.

Keywords: Immigration, Impact, France

JEL Classification: J15, J31

Suggested Citation

Ortega, Javier and Verdugo, Gregory, Immigration and the Occupational Choice of Natives: A Factor Proportions Approach (July 2011). Banque de France Working Paper No. 335, Available at SSRN: https://ssrn.com/abstract=1898565 or http://dx.doi.org/10.2139/ssrn.1898565

Javier Ortega (Contact Author)

Kingston University London ( email )

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London, KT1 2EE
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London School of Economics & Political Science (LSE) - Department of Government

United Kingdom

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

University College London - CReAM - Centre for Research and Analysis of Migration ( email )

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London, WC1H 0AX
United Kingdom

Gregory Verdugo

Université Paris I Panthéon-Sorbonne - Centre d'Economie de la Sorbonne (CES) ( email )

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106-112 Boulevard de l'Hôpital
Paris Cedex 13, 75647
France

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